Kansas regulators disagree on increasing KCP&L’s rates

Topeka  Kansas regulators couldn't agree Tuesday on how much to increase Kansas City Power & Light Co.'s annual rates, with the utility's charges for customers with electric heating systems emerging as a key issue.

State law gives the rate-setting Kansas Corporation Commission until Sept. 10 to issue a written order on KCP&L's proposal to raise $67 million more annually from its 247,000 customers in the state's northeast corner. The utility estimated its request would boost rates by 12.5 percent, or $11.67 a month for an average residential customer.

KCP&L and other parties, including the Citizens' Utility Ratepayers Board, have agreed on many issues, likely scaling back the utility's proposed increase. But during a public discussion Tuesday, the three KCC members each had different figures for how much profit they believe the company should be allowed to earn as a regulated utility.

The company contends it needs additional revenues to cover the costs of upgrades at the Wolf Creek nuclear power plant and the coal-fired LaCygne power plant, both in eastern Kansas. It sought to boost its annual profit to 10.3 percent from 9.5 percent; CURB, a state agency representing residential customers and small businesses, proposed 8.55 percent. Parties in the case do not agree on a figure.

Commissioner Pat Apple said he supports the lowest figure if the KCC won't drop rates charged in fall and winter to customers with electric heating. A decade ago, KCP&L discounted its energy charge by as much as 51 percent to encourage the use of electric heat, but in recent years, the commission has reduced the discounts to as little as 10 percent.

CURB raised the issue and said between 40,000 and 50,000 of the utility's Kansas customers have electric heat, many in the growing Kansas City suburbs of southern Johnson County. Apple is a former state senator from Louisburg whose district included southern Johnson County, and he called rate increases seen by consumers with electric heat "unconscionable."

"We failed the public," Apple said.

Commission Chairwoman Shari Feist Albrecht noted that reducing the discounts was aimed at ensuring customers' rates covered the costs of providing electricity to them. She questioned whether the KCC has gathered enough evidence to support Apple's proposal to return to deeper discounts, particularly if the KCC's order is challenged in court.

"Who is the public that we're serving?" she said. "It's all the public."

KCP&L declined to comment on the commission's discussions.

The utility also proposed a rate increase of nearly 16 percent for 270,000 of its 565,000 Missouri customers to raise another $121 million in revenues.